The buyer for Nigerian telecoms firm Nitel has won an extra six weeks to pay the $1.3bn it had offered for the telecoms firm.

Earlier on Tuesday, it looked like Africa's biggest privatisation deal had collapsed as the buyer failed to provide the cash in time.

The Investors International consortium, a group comprising Nigerian and Portuguese investors, made a downpayment when it signed the deal in November, but has since quibbled about the price.

The Nigerian government tried to open talks with the second-placed bidder, Telnet, backed by Sweden's Telia and Korea Telecom.

"We have received a response from Telnet declining to engage with us in negotiations," Hassan Usman, deputy director of the Bureau for Public Enterprises said.

"If at the end of the six week extension, IIL does not pay...we will then start the process again until we sell Nitel," he added.

It is understood that Telnet may be interested in bidding for the second licence on offer, hopefully securing it for less than the Nitel sale, the BBC's Dan Isaacs in Lagos said.

Lack of investment

Many had argued that the Nitel price tag was too high, which could have cut into the investment needed for Nigeria's desperately underfunded telecoms network.

When the deal was signed, Tani Fafunwa, analyst at Nigerian telecoms consultants Resourcery, said: "The $1.3bn... would have been of more economic benefit to Nigeria if it had gone straight into developing the network and setting up the GSM mobile network."

Some analysts said $600m-700m would have been a better indication of Nitel's true value.

Nigerian capital

Investors International is believed to be financed by Nigeria's Chief Bode Akindele.

The Nitel bidding rules anticipated that large international operators would be at the head of the queue, but the four consortia listed were fronted by local business groups, which were linked up with international operators to provide the technical expertise.

Tecnologia de Communicacoes (TDC), a subsidiary of Portugal Telecom, was the foreign technical partner in the Investors International bid.